Leading customer engagement platform, Twilio has shared some trends that will shape brands’ customer experience strategies in Australia in the coming year.
- The importance of trust
The future of brand relationships will be built on an ‘Ecosystem of Trust’, according to Twilio vice president for communications in Asia Pacific & Japan, Robert Woolfrey.
“Trust has always been the cornerstone of brand loyalty, but in 2025, consumer trust is poised to hit an all-time low. According to Twilio’s 2024 Consumer Preferences Report, 68% of consumers in Australia say they will not purchase from a brand they don’t trust,” he said.
“With consumers growing increasingly cynical and scrutinising every interaction, brands must demonstrate greater respect by putting themselves in their customers’ shoes.
“It’s time to return to the basics in 2025—keeping promises, following through, and delivering reliable and supportive experiences, during key moments of truth. As the focus shifts towards cultivating an ‘Ecosystem of Trust’, more brands will turn to Chief Trust Officers, to help redefine customer experience, marketing, and technology strategies for building lasting customer relationships.
“AI will continue to be a key driver in solidifying this ‘Ecosystem of Trust. Brands will increasingly bet on predictive AI as they strive to eliminate guesswork, refine recommendations and improve communications ultimately strengthening brand-customer interactions.”
2. Experiential loyalty
Twilio senior director for solutions engineering in Asia Pacific & Japan, Ben Chamlet believes consumers are giving retailers a run for their loyalty and more brands will turn away from traditional ‘earn-and-burn’ models.
“Customer loyalty programs driven mainly by discounts and cashbacks are on their way out. Instead, brands will shift towards creating experiences that surprise and delight customers, making them feel valued as their individual preferences and behaviour are taken into account,” he said.
“For instance, instead of offering financial incentives, brands might surprise loyal customers with preferential access to new products, or exclusive invites to previews – which cost retailers little, but provide genuine value to loyal customers.
“A key priority will be around strengthening ‘phygital’ loyalty programmes, combining in-store activations with special offers for loyalty members. Brands will become more intentional about leveraging data to test, iterate, and quickly refine their loyalty strategies.
“Brands will use data not only to create meaningful moments for customers but also to remove friction from the journey—including streamlining checkout and simplifying rewards redemption.”
3. A turning point for chatbots
Bots will move away from deflecting towards genuinely connecting and engaging, according to Twilio solutions engineering lead for communications for Asia Pacific & Japan, Chris Connolly.
“Most chatbots today serve as mere stopgaps, deflecting issues until a human agent steps in to provide real solutions. In addition, chatbots trained on static resources like FAQs or manuals offer generic answers but often miss the opportunity to deliver truly individualised responses tailored to each customer. As they operate based on straightforward rules and predefined content, chatbots struggle to generate responses that truly simulate human engagement,” he said.
“2025 will mark a turning point in front-line communications as the focus shifts towards eliminating friction in such chatbot engagements. Brands are already adopting conversational AI systems capable of better identifying user intent and generating sentences that mimic the nuances of human conversations. Conversational AI can engage with customers, reference previous interactions, and respond in a way that feels more dynamic and natural.
“Beyond conversational AI, brands are also realising the potential of intelligent AI agents that can offer/ upsell products and services, take action on customer issues, make decisions within constraints, and operate across communication channels. These agents—which are not confined to chat windows—have an in-depth understanding of consumer preferences collected over time, past purchases, and previous customer interactions such as login issues or unresolved concerns. They can tailor their communication style to a specific context across channels. AI agents can even be triggered based on an event in the customer journey.
“The holy grail is to make these AI agents invisible yet highly effective, creating a customer service experience that feels natural, effortless and trusted. Contextual data can help turn this into reality, empowering AI agents to better anticipate consumer needs and resolve issues quickly and eliminate the hassle of requiring customers to repeat themselves.
“The future of verification and authentication is inclusive. Historically, SMS OTPs have been the go-to method for two-factor authentication (2FA). Their simplicity and wide adoption have made them a reliable choice, but they come with notable limitations, such as vulnerability to SIM swapping and security concerns around unencrypted messages.
“In 2025, we can expect a significant shift in how brands approach user authentication, driven by the emergence of new messaging protocols like RCS, Silent Network Authentication (SNA) and Passkeys. SMS OTPs won’t disappear entirely, but will become a mere thread in organisations’ broader, more flexible authentication strategy.
“Rather than relying on a one-size-fits-all solution, brands will tailor verification methods to suit different scenarios and user needs. RCS, for example, enables secure, encrypted, end-to-end messaging that eliminates the need for a code — users can simply click to approve their identity. While passkeys offer a smoother, frictionless experience, they are rapidly being deployed across all apps, and many developers have yet to fully adopt them. In these cases, SMS-based OTPs will remain an important fallback option, especially when users switch devices or face compatibility issues.
“SNA is also on the rise as a friction-free authentication mechanism that works by checking if the user’s device is both known and connected to the right network in the right place. Unlike other OTP methods, the end-user doesn’t need to interact with the app to enter digits or press buttons.
“In 2025, more brands will adopt a combination of verification methods, considering factors like security requirements, device type, and user location, to create a more adaptive authentication process that balances robust security with a seamless user experience.”
4. Smarter data collection and management
Twilio Segment area vice president for Asia Pacific & Japan, Liz Adeniji (featured iimage) believes data will become the ‘X factor’ as LLMs level the playing field.
“Deploying a bot that can greet users, tell the time, and engage in small talk has become the baseline. What will set brands apart going forward is how they leverage their customer data to deliver truly seamless, superior experiences,” she says.
“Smarter practices around data collection and management will take centre stage in 2025. One emerging trend is the shift towards data expiration, as brands recognise the risks of holding excess data while customers grow more protective of their information. Moving forward, brands will focus on collecting only essential data—such as email, phone number, and name—while letting temporary or unnecessary data expire.
“The importance of having clean and consistent contextual data cannot be overstated as brands increasingly integrate AI agents and conversational AI into the customer journey. More brands will invest in customer data platforms (CDPs) and scalable data validation frameworks to ensure data reliability and trustworthiness at scale.
“Brands ditch point solutions as they consider the bigger picture. Technology will bring teams closer together. In many organisations, marketing, sales, and customer service teams often operate in silos – each focused on their data and objectives. This fragmentation complicates attribution and campaign performance reviews due to the lack of a unified view of the customer.
“In 2025, more organisations will move away from isolated, point solutions as they realise the value of breaking down silos. They will adopt more holistic, ROI-driven approaches to resolve issues such as redundant customer retargeting, and work towards better reallocating resources toward initiatives that enhance customer satisfaction. By aligning data seamlessly across business units, these brands can enable smarter, more personalised marketing that truly resonates with individual customers.
“Emerging technologies like CDPs and data warehouses will continue to gain traction, serving as unifying forces that dissolve the traditional silos that exist within business divisions and teams. These technologies will serve as the cornerstone for collaboration, bringing together diverse teams and business units under a common language – data. Key leaders including the CTO, CMO, CPO, CCO, CDO and CRO will increasingly contribute to shaping the data strategy and vision of an organisation, fostering a comprehensive, unified view of the company and business practices (not just a customer).”